SCOTT AND HODGSON LIMITED Vs. KESHAVLAL-NATHUBHAI SHAH

JUDGEMENT

(1.) The plaintiffs are appealing against the judgment of the learned First Glass Subordinate Judge of Ahmedabad on the ground that he has wrongly decided in the negative the point of law involved in issue No. 1, namely, whether the agreement between the parties that the property in the suit goods should not pass until the whole of the purchase price had been paid, was valid and effective having regard to Secs.83 and 77 of the Indian Contract Act of 1872. There were several other issues raised in the case all of which were decided in favour of the plaintiffs And there are cross-objections before us in respect of them. But we have taken first this point of law because it is the decisive issue in the suit in certain events.

(2.) The contract which was made in India is contained in three letters of February 1, 9 and 9, 1923. By the first letter, Ex. 42, the plaintiffs were to supply an engine and a boiler therein specified for in all - 3,480 packed and delivered for shipment f o. b. Manchester or Birkenhead on the terms that one third of the total value was to be paid on signing the order and the balance against shipping documents through Banks in England and subject to usual strikes, lock outs, etc Delivery was to be given within from five to six months after the receipt of full particulars by the makers in England. By the second letter, Ex. 41, the time for delivery was fixed to be about the e July, 1923."

(3.) The third letter, Ex 127, varied the contract materially as to payment and is relied on by the plaintiffs as resulting in the property not passing It stated: We beg to confirm the following terms of payment, as agreed between us this afternoon namely: Rs. 5,000 (say five thousand rupees) on signing this order. Rs. 5,000 (say five thousand rupees) immediately we cable shipment. To wit say July 31, 1923. Thence. Rs. 3,000 (say three thousand rupees) on the last day of each month by post dated cheques on a recognised Bank. All the sums paid by you in rupees will be finally converted in pounds sterling at the rate of exchange ruling on the date of each cheque. It is to be understood that the complete plant as supplied by us is to remain our property and to be completely covered by insurance by you until the final payment is made; and further that you are to expedite payments if at ail possible. The insurance policies and the premium receipts to be in our possession until the final payment is made. Kindly confirm this agreement and enclose your first instalment.